Sunday, November 06, 2011

How Many Pinheads Can Dance On An Angel?

I liked that title when I thought of it. I wish I could have thought of a post to go with it, but economists will tell you, "You can't have everything."
As I understand last Friday's Planet Money Podcast, the twin pillars of modern economics are Maynard Keynes, a brilliant but dissipated scholar and bon vivant, and Friedrich von Hayek, a Nobel prize winning Austrian. Keynes believed that targeted government spending could make up for falling consumer demand to prop up the economy during a recession. Hayek believed that the best thing government could do was to stay out of the way of a self-correcting free market. Obviously, a case can be made for both approaches, since their acolytes have been debating since the 1930's.
What is so infuriating about the current crop of "conservative" Republicans, is that while claiming to be followers of Hayek, they are practicing targeted spending and tax cuts to the richest people in America. If low tax rates for the rich and financial deregulation are so effective, then why have they lead to disaster?

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